GOOD NEWS! The best thing about Glen Grunwald (right) becoming the Knicks' interim president on July 1 is he no longer has contact with Isiah Thomas. Photo: N.Y. Post

The bad news about Glen Grunwald, who becomes the Knicks interim president on July 1, is Isiah Thomas hired him in Toronto and then hired him again with the Knicks. Thomas and Grunwald, both out of Chicago, were co-captains on Indiana’s 1981 national championship team.

The good news about Grunwald is he no longer has much contact with, and is not influenced by, Thomas. Grunwald had too much loyalty to outgoing president Donnie Walsh, who on Friday stunned the NBA by walking away from a contract-extension.

Grunwald has been the Knicks’ senior vice president of basketball operations since 2006, hired by Thomas to run the front office when Dolan forced Thomas to the bench. With Thomas’ dual role as president/coach, Grunwald stayed in the background, despite being the Raptors general manager from 1997 to 2004.

When Walsh took over for Thomas, Grunwald stayed on with the same title, was given a contract extension despite his ties to Thomas. Brendan Suhr, the player personnel director who also was considered Isiah’s righthand man, was let go after Walsh’s first draft in 2007. That Walsh kept Grunwald showed an admiration for his work and loyalty.

The Post has learned Grunwald — unlike most of the Knicks scouts — has a contract that extends to October, when the potential lockout could still be going on. Virtually all of Walsh’s scouts have contracts that expire June 30, including player personnel directors John Gabriel and Misho Osterovic.

The big question is whether Grunwald will fill the bill as president for all of next season — given the expected lockout will reduce revenues and that the current Knicks need front-office stability more than anything.

“Glen could do the job,” one person close to Walsh told The Post. “He did it in Toronto. If it wasn’t for Vince [Carter’s] injuries, he’d still be there.”

As Walsh plowed on, he never named Grunwald officially as the GM. Walsh wanted to make the splashy hire of former St. John’s legend Chris Mullin and groom him as his successor. Sources say owner James Dolan refused to allow Walsh to hire a GM because the owner felt Grunwald filled the role nicely.

Yesterday, Walsh told The Post: “Glen was a very competent man who was very helpful to me in the last three years. He understands the general-manager role having done it in Toronto. I always had high regard for him when I dealt with him in Toronto and was happy he was here when I took the job. He was very helpful.”

Because of Walsh’s overwhelming Godfather-like presence, Grunwald took a back seat and was not authorized to talk to the media. Even yesterday, despite his new appointment, Grunwald declined comment, saying: “Everything’s status quo. Donnie is still running the draft. And then after that I may get the opportunity.”

Grunwald, who has a law degree from Northwestern, is considered the team’s No. 1 expert on the salary cap. With his law degree, he never bothered to hire an agent, which probably reduced the buzz around him.

In Toronto, Grunwald did solid work, drafting Vince Carter, acquiring Antonio Davis and trading with the Knicks for Charles Oakley. Grunwald got the Raptors in the playoffs for three straight seasons from 2000-02 when they averaged 45 wins and knocked out the Knicks in 2001. Grunwald still has the game ball from Toronto’s Game 5 victory.

As a consultant, Walsh will help in the presidential search that several sources say will be painstakingly slow. Kevin Pritchard, Knicks interim scout Mark Warkentien, Kiki Vandeweghe, Jeff Bower, Danny Ferry, Allan Houston — maybe even John Calipari — are expected to be approached. As previously reported in The Post, Thomas will not be considered for this particular hire, if there is one.